More drivers are learning about alternative biodiesel

Friday, February 18, 2005

By KRISTIN DIZON
SEATTLE POST-INTELLIGENCER REPORTER

Biodiesel is all around us -- in our ferries, buses, garbage trucks, passenger cars, tractors, Army trucks, sailboats and more -- yet surveys show that only one in four people knows about this alternative, non-toxic fuel made from vegetable oil.

P-I GRAPHIC

View a graphic explaining biodiesel, its benefits and its uses.

But biodiesel is poised for liftoff, and more people are discovering its benefits. About 30 million gallons of biodiesel was produced and used in the United States last year -- a sixfold increase in just five years.

The fuel runs in diesel engines but emits 78 percent less carbon dioxide, nearly 50 percent fewer particulates and 80 percent to 90 percent less of compounds linked to cancer than diesel, and fewer greenhouse gases than gasoline. (Engines using it do emit more nitrogen oxide, a smog-forming component.)

For the first time, an American company has made a car -- the 2005 Jeep Liberty -- designed to run on a 5 percent blend of biodiesel (B5). John Deere said it will start shipping all of its tractors and combines to customers filled with B2, a 2 percent biodiesel blend.

Country singer Willie Nelson, who uses biodiesel in his tour buses, recently announced a new company to make and sell "BioWillie" fuel to truck stops across the nation.

Even President Bush has weighed in, with a simple "I like biodiesel," while on the campaign trail in Iowa.

Five years ago, biodiesel was virtually unused in Washington -- this year more than a million gallons will be burned.

The wholesaler that imports nearly all of the state's biodiesel, Pacific Northwest Energy Co. and SC Fuels in Tacoma, began selling biodiesel in January 2004. Now they're bringing in more than 1.5 million gallons of pure biodiesel, B100, a year.

"Washington is probably one of the largest users in the country," said Vince "biovinny" McBroom, the commercial sales manager. "We're at least in the top five, if not the top two."

Though biodiesel isn't currently made in Washington, that's about to change. Experts say the state could produce and refine 5 million to 8 million gallons within five years.

Interest in a biodiesel industry in Washington state is producing cooperation across the political aisle. The state's first biodiesel plant is about to start operating, and several other groups hope to get crops from Washington fields into our tanks.

Plans and passion abound, but so do risks and uncertainties.

Biodiesel isn't the solution to a waning supply of fossil fuels but an appealing part of the solution. There simply isn't enough of it.

"The Department of Energy estimates that biodiesel could replace 10 percent of the diesel market in the U.S.," said Jenna Higgins, a spokeswoman for the National Biodiesel Board. "Biodiesel is not a replacement for petroleum diesel. It's another tool in the box to reduce our dependency on foreign oil and clean up emissions."

About 60 billion gallons of diesel is used annually in the United States, a billion of that in Washington state. Current biodiesel production capacity is estimated at about 150 million gallons a year, with a possible doubling within 12 to 18 months.

There is a huge potential market for biodiesel -- about 95 percent of freight, through trucking, railroads and shipping, is moved with diesel engines.

In Europe, where fuel prices favor diesel-powered vehicles, more than 40 percent of passenger cars are fuel-efficient diesel ones, some of which get 65 miles per gallon or more. Estimates suggest that 3 percent or less of passenger cars in the United States -- or about 4 million of more than 135 million registered run on diesel.

Part of the problem has been diesel's image -- acrid smell, dark exhaust cloud, toxic emissions and rumbling engine performance. That's improved somewhat over time, but biodiesel is a different creature altogether. Its odor is often compared with stir fry or popcorn, and it usually makes diesel engines run smoother, while acting as an engine lubricant and cleaner. It's also not as volatile as gas or diesel.

The biggest hurdle to its widespread use is probably price. For the individual consumer, pure biodiesel costs $3.30 to $3.50 per gallon. Compared with five years ago when the price tag was about $5 a gallon, it's become more affordable.

Many late-model diesel vehicles get 40-plus mpg, making the cost per mile for using biodiesel close to that for many gasoline-powered vehicles.

But the price will likely drop again soon. A two-year federal tax credit began on Jan. 1. It gives blenders a penny a gallon for every 1 percent of biodiesel they distribute, up to $.99 for B99, but it's not clear how that would affect B100 users.

Many expect that credit to result in a price reduction for the consumer, making biodiesel more attractive. (At the same time, Bush's latest budget proposal calls for a halving of federal biodiesel subsidies, which could affect the price, too.)

Government at the wheel

Though Seattle has an enthusiastic core of biodiesel users in personal cars, it's government that's been driving the demand for biodiesel.

"The biggest users are centrally fueled fleets -- like city bus systems, school districts, military bases, national parks and city fleets, "said Higgins, from the National Biodiesel Board, funded largely by soybean farmers and fuel suppliers.

Besides lower prices for buying fuel in huge quantities, another reason for high institutional demand is government policy. Besides the new tax incentive, the 1992 Energy Policy Act, designed to decrease the nation's dependence on foreign oil, requires federal and state fleets to purchase alternative fuel vehicles. And several executive orders signed by President Clinton require federal agencies to reduce petroleum use or replace some of it with alternative fuels.

The military is another huge biodiesel customer. Naval Station Everett was an early adopter, starting its buses and heavy equipment on a B20 blend four years ago.

"The fuel system is just as clean as a whistle. It gets rid of all of the things that have built up over the years," said Gary Passmore, transportation specialist for the station.

King County Metro Transit is running 338 buses of 1,400 on a B5 blend and hopes to expand the fuel to its entire fleet sometime next year, fleet manager Jim Boon said.

King County Executive Ron Sims said Metro's adoption of biodiesel likely will spur other transit agencies around the country to try it.

"How can we as a government reduce global-warming impacts? This was easy. This was a no-brainer for us," Sims said.

The biggest user here is Washington State Ferries, which began a pilot project last summer to run three ferries on B20 on the Seattle-Vashon-Southworth route. But they began having problems with clogged fuel filters and removed the fuel in December.

"We are looking very hard for an answer," said Tina Stotz, environmental program manager for the ferries. "We would love to have the biodiesel up by the end of February."

The fuel is paid for by Seattle City Light as part of a city effort to reduce and mitigate greenhouse gas emissions.

The biodiesel used here is almost all soy-based oil imported from the Midwest, but biodiesel enthusiasts are working hard to change that.

Biobusiness

A few businesses such as Earthwise Excavation choose biodiesel for its environmental benefits. The Maltby Co. uses more than 18,000 gallons of B100 in its bulldozers, dump trucks and other earthmoving equipment. Albert Postema, president of the company said it helps the business stand out in a crowded field.

"We feel that businesses can do a large leadership role in sustainability," Postema said. "And if an excavation company can do that, the sky's the limit." And they just bought a small processor to make their own and plan to create a co-op, Barter Biodiesel, in which people bring in waste grease and get back biodiesel. So far, 65 people have signed up.

Others are getting into the business of making biodiesel.

At a warehouse in Sodo, John Plaza is about to open Seattle Biodiesel, the first plant in Washington to make the fuel. Plaza, an airline pilot, feels good about the gamble he's taking on an industry in its infancy.

"The more I find out about biodiesel, the more I feel that it offers our country, the planet and our species as a whole a better option than what we've been faced with," he said.

With investors such as Sabyr Contractors Inc., and the founder of Loudeye Corp., Plaza plans to produce his first test batch of biodiesel on Monday in his 6,500-square-foot plant. He's aiming to make 1.5 million gallons of biodiesel a year and have the capacity to produce up to 5 million gallons annually if that's ever needed. Already, three of his 12 massive steel tanks, salvaged from the Rainier Brewery, are filled with soybean oil from Smucker's, the jam maker.

Plaza, in partnership with a California company, is making and selling an industrial biodiesel processor, which has a patent pending.

He's not alone.

Baker Commodies, Inc., a national company that runs rendering plants for slaughterhouse remnants, is looking into making biodiesel, too. They also recycle used cooking oil and restaurant grease at a Tukwila facility. Fred Wellons, director of research and development, said Baker is looking for 3 to 5 acres in the Seattle area to build a 10-million gallon biodiesel plant.

"It's all biodegradable, so it's not like you have a petroleum plant. It's edible fat," he said.

About 9 million gallons of waste grease and oil is produced in Western Washington, according to Climate Solutions, a non-profit group. If every drop of it was made into biodiesel, it's nearly enough to run the state ferry system for a year.

Like Seattle Biodiesel, Baker commodities would be interested in state-grown crops for biodiesel.

The problem is that, right now, they don't exist.

From field to pump

Biodiesel can be made from numerous crops, but some of the best are oilseeds such as canola, mustard and rapeseed. High in oil content, such plants require little water or fertilizer, and are well suited to Washington's dryland farming as a rotation crop. But last year, only 8,200 of Washington's farm acres were planted in any of those crops -- a paltry number compared to the 2.5 million acres in grain.

"Everybody has gotten the cart in front of the horse," says Jim Armstrong, director of legislative and public affairs for the Spokane Conservation District. "What's happened in Washington is talk about big biodiesel facilities and distribution. But none of it matters unless we can get the farmers to grow the feed stock."

There are several hurdles to convincing farmers it's a good idea. The first is that Washington doesn't have its own industrial oil crusher, a giant screw press that extracts the oil. The closest crushers are in Great Falls, Mont., and Alberta. The costs of shipping the crops there and back has made it too costly to produce biodiesel.

Another issue is that the oil itself is of low value. Farmers need a primary market for the meal, or crush, of the crops -- for animal feed, fertilizer, fumigants, biopesticides and biolubricants. Then they could sell the oil as a secondary product, deriving two income streams from the same crop.

The make-or-break price for growers is around 14 to 15 cents a pound for oilseeds, which, without other markets, would make the oil about $3.45 a gallon before it's even made into biodiesel, Armstrong said.

There are at least two efforts to build crushers here. American Premix Technologies is building a small crusher in Quincy, near Ephrata, with plans for a second crusher in Creston and a third at a future location. They plan to grow canola, crush it for animal feed and sell the oil for biolubricants or biodiesel, said Brad Lyons, vice president of marketing for the company. In the future, American Premix might make its own biodiesel.

A consortium of six agricultural cooperatives in Spokane County has formed Pacific Bio LLC to operate a crusher to process up to 30,000 acres of their own oilseeds. They hope to plant oilseed crops next year and get into biodiesel production later.

Having home-grown oil and local processors should lower the cost of biodiesel. "We should be able to beat the price of Midwestern biodiesel, because we don't have to transport it here," said Tim Stearns, a senior energy analyst with the state government's Community Trade and Economic Development division.

It also has the dual benefit of stimulating rural economic development. "We are hoping to diversify the agricultural sector," Stearns said.

He also sees a market for exporting biodiesel knowledge. "If we get good at it, there's the whole rest of the world that's going to need expertise and advice," he said. "We can either be driving the steamroller, or we can be driven over by it."

Armstrong thinks the momentum for home-grown biodiesel is unstoppable in Washington.

"Everybody we've talked to thinks this is the neatest thing since sliced bread," he said. "Everybody wants to make it work."

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